BILL ANALYSIS
------------------------------------------------------------
|SENATE REVENUE & TAXATION COMMITTEE | SB562 - |
| | Poochigian|
------------------------------------------------------------
------------------------------------------------------------
|Senator Wesley Chesbro, | Amended: April 5, 1999|
|Chair | |
------------------------------------------------------------
------------------------------------------------------------
| |
------------------------------------------------------------
-----------------------------------------------------------
|Hearing: April 21, 1999 | | Fiscal: No|
-----------------------------------------------------------
SB 562 - Poochigian
Page
SUBJECT: Transient Occupancy Tax: Prohibits application of
the tax to in-room products and services; limits
the tax to the lodging portion of a room
"package" that also includes other services
(admission to an amusement park or use of golf
course facilities)
DIGEST
EXISTING LAW allows the legislative body of a city or
county to levy a tax on the privilege of occupying a room
in a hotel, inn, or other lodging unless the lodging is for
any period of more than 30 days.
THIS BILL limits application of the transient
occupancy tax as follows:
1. Prohibits a legislative body from levying the tax
with respect to any in-room product, service or amenity
that a guest may purchase and for which a separate charge
is imposed (such as an in-room movie).
2. Limits the tax to only the lodging portion of an
all-inclusive price where the following conditions are met:
(a) the innkeeper sells room accommodations and other
services (such as admission to a theme park or use of a
golf course) all included in one price with the price of
the room accommodations and
(b) the innkeeper separately states on internal
records the respective values of the room accommodations
and the other services. The bill provides that the
innkeeper is not obliged to disclose to a guest the
respective values of the room accommodations and the other
SB 562 - Poochigian
Page
services.
The bill also makes various technical and clarifying
changes.
FISCAL EFFECT:
The bill will have no state fiscal or revenue impact.
It may limit or reduce tax revenues to local governments by
restricting application of the transient occupancy tax.
COMMENTS:
A. Purpose of the bill
The sponsor indicates that today many innkeepers offer
"packages" to their guests that may include admission to an
amusement or theme park or use of a golf course, along with
lodging. This bill is intended to clarify that cities and
counties may charge the transient occupancy tax only on
that portion of the all-inclusive price that is applicable
to the occupancy of the room accommodations.
Support and Opposition
Support:California Hotel and Motel Association
(Sponsor)
Cal-Tax
-------------------------------
Consultant: Jeanette Rapp
April 15, 1999 3:55 PM